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I am currently working on a sole-source IDIQ. I have solicited multiple fixed price supply items (non-commercial). My RFP includes range pricing and a Best Estimated Quantity (BEQ) /Annual Demand Value (ADV). The BEQ/ADV is based upon forecast data provided by the customer tempered with common sense and buy history. For Instance: A CLIN on my RFP may look something like this 0001AA Antenna Widget Quantity Range 100-190 (BEQ/ADV – 150) 191-200 201-270 I expect discreet pricing for all ranges, for all years of the contract (5 in this instance). My solicitation/RFP requires a FAR 15.408 table 15-2 compliant proposal. I state specifically that cost analysis must be performed by the offeror for subcontracts identified in the CBOM as having total proposed pricing that exceeds the regulatory threshold indicated in FAR Part 15.403-4 AND that Fair and reasonable subcontractor analysis in accordance with FAR 15.404-3(b) shall be provided. My Question: What is the basis of the threshold for subcontract Cost Analysis (CAPA) for an IDIQ contract? Is it based on the max quantity you anticipate buying or the estimated quantity you believe you will buy…The BEQ/ADV or the Max? In the example above, would you base the threshold on unit price x qty of 270 OR unit price x qty of 270…obviously very simplistic because on some of these RFP’s there are hundreds of items. I ask this because I interpret the subcontractor CAPA threshold as being the anticipated maximum value of the contract (max value for all solicited items IDIQ). The problem is that we are asking for ranges above what we historically buy, because our customer anticipates that there could be a need for those higher quantities. Contractors raise concerns on ROI and provide long lead time for proposal development when they interpret the RFP in that manner. I believe there truly is a case to be made for limiting the CAPA threshold to what we plan to buy (ADV/BEQ), but do have concerns that high dollar value subcontracts will go unchallenged. Regardless of the CAPA threshold, contractors would still be required to provide subcontractor pricing for all ranges and typically provide a high % of firm quotes with their bid. I would also like to add some additional context. I make a thorough evaluation of the ADV/BEQ we use and remove ranges (especially high ranges) when I have no reason to believe the Government will have a need to buy at that high a quantity. Interested in your thoughts on the topic.
Scenario: Government has a prime IDIQ contract with a $800M ceiling under which CPFF/LOE Task Orders are issued. The Task Orders are primarily for labor hours (non-commercial services). Prime contractor is stating that they estabished T&M contracts (reasonableness based on price analysis) with their subcontractor suppliers for the length of the prime IDIQ contract at the time of the initial IDIQ award (10 months ago). A new Task Order is being solicited by the Government valued at $100M. Cost or Pricing data submitted by the prime indicates they are proposing subcontract cost from one subcontractor @ $20M. Prime is stating that because they have an established subcontract already in place, they can certify to their proposed costs and do not have to cause the subcontractor to submit certified cost or pricing data to the government, even though they are proposing subcontract costs (and intend to issue a Task Order under their T&M agreement) that exceeds the $12.5M threshold referenced in FAR 15-404-3©(1)(i). Does the prime contractor have to cause the subcontractor to submit certified cost or pricing data or can the prime simply submit the subcontract agreement and the initial prime analysis used to determine the reasonableness of the T&M rates?